Hagel: No
budget cuts off-limits
By Jeremy Herb - 04/03/13 12:51 PM ET
Defense
Secretary Chuck Hagel on Wednesday said no budget cuts will be off-limits as
the Pentagon looks to tighten its belt. “We need to challenge all past
assumptions, and we need to put everything on the table,” Hagel said in his
first major policy address, according to prepared remarks.
Speaking at National Defense
University at Fort McNair, Hagel defended his review of the military’s
strategy, which he ordered shortly after taking over at the Pentagon. He said
the military must look at change “that involves not just tweaking or chipping
away at existing structures and practices but, where necessary, fashioning
entirely new ones that are better suited to 21st century realities and
challenges.”
Hagel said the biggest fiscal
challenges facing the Pentagon are not declining or flat-lined budgets, but the
“growing imbalance” of how money is spent internally.
“It is already clear to me that
any serious effort to reform and reshape our defense enterprise must confront
the principal drivers of growth in the Department’s base budget namely
acquisitions, personnel costs and overhead,” he said. Hagel’s speech comes one
month after across-the-board sequestration cuts took effect, occurring just two
days after he was sworn in as defense secretary. With no budget deal on the
horizon between the White House and Congress, how Hagel and the military tackle
sequestration has the potential to be a major part of his legacy at the
Pentagon.
The military already issued a new
strategic guidance in 2012, after the Pentagon’s budgets over the next decade
were reduced by $487 billion under the Budget Control Act. With sequestration,
$41 billion will be cut in 2013 and $500 billion could be reduced in the next
decade, which senior military leaders have said would require the Pentagon to
change its new strategy and scale back ambitions. Hagel said Wednesday that the
department’s new strategic review should come with options so the military can
be prepared if there is a budget deal to reverse sequester or if the cuts do
persist for years.
“We cannot simply wish or hope
our way to carrying out a responsible national security strategy and its
implementation,” he said. “The Department must understand the challenges and
uncertainties, plan for the risks and, yes, recognize the opportunities
inherent in budget constraints and more efficient and effective restructuring.”
Hagel talked about streamlining
the military’s command structures, paring back the “world’s largest
back-office” and examining the number of active-duty service members. He
touched on the need for a more cost-effective acquisitions process and avoiding
the major cost overruns that have plagued weapons programs like the F-35.
But he also emphasized that the
military is not a business.
"The military is not, and
should never be, run like a corporation," Hagel said. "But that does
not mean we don’t have a good deal to learn from what the private sector has
achieved over the past 20 to 30 years."
The moves Hagel discussed
Wednesday are among the most common cited by budget cutters who say that the
Pentagon can achieve the level of cost savings required under sequestration.
Hagel did not get into many specifics in his address, saying that he did not
want to prejudge the strategic review that’s currently under way.
“It could turn out that making
dramatic changes in each of these areas could prove unwise, untenable or
politically impossible,” Hagel said. “Yet we have no choice but to take a very
close look and see how we can do all of this better.” Hagel’s first chance to
lay out specifics will come next week, when the Pentagon unveils its 2014
budget request. Pentagon officials have said the budget won’t include the $50
billion reduction in 2014 that would be required if sequester is not changed.
The budget is expected, however, to include long-term cost savers including
base closures and increases in healthcare fees — both of which were roundly
rejected by Congress during the 2013 budget process.
Hagel also made a pitch Wednesday
for more “flexibility” to deal with sequestration, something military officials
had been hesitant to request back before the cuts went into effect. “If we get
time and flexibility to implement savings, we could limit the impact of
spending reductions on force structure and modernization while still making a
significant contribution to deficit reduction,” Hagel said.
“By contrast, the cuts required
by sequester afford neither time nor flexibility. These quick and dramatic cuts
would almost certainly require reductions in what have long been considered
core military capabilities and changes in the traditional roles and missions
among the uniformed services,” he added.
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